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Tax Tip: Verschenkte property

To give the property to relatives is a way to regulate the succession in advance. But many think of the gift shop. What is still to be observed depending on the type of property is valid.

One of property to close relatives to give away is a way to regulate the succession in advance. So their children can use much earlier house and grounds. But while many think of the gift tax on the gift, the income tax consequences are often overlooked.

Transfers of Schenker, a private-use property, free of charge, this has basically no further income tax consequences for him. The situation is different in the gratuitous gift of an apartment building is located in private assets. Because with the transfer of beneficial ownership the Einkunftserzielungsabsicht and thus in principle also the related expenses deduction ends. The possibility of tax depreciation of the building in the tax return is transferred to the recipient. Unless the recipient, therefore, continues to use the property for Einkunftserzielung, he can continue the tax allowance for depreciation of the donor.

Rented the recipient previously privately used property but for the first time, the original cost of the Zuwendenden are decisive for the amount of depreciation. After the transition to Einkunftserzielung, the recipient can start only the “remaining” write-off for tax purposes. Because depreciation, which is attributable to the period prior to the letting of the building previously used for private purposes, is considered to be consumed.

Tax breaks for the recipient

Is that too-giving object not of debt, a debt assumption comes from the recipient into account. Advantage: The recipient can make the interest owed on the tax return for the income from renting and leasing law. Disadvantage: In this case, there is regularly no gratuitous, but a teilentgeltliche transmission. The process must then be divided into a pecuniary interest and in a gratuitous part. The donor then has to be careful that no taxable capital gain arises in him. For the Property is transferred teilentgeltlich within ten years of purchase, a capital gain may occur. This is calculated by comparing the sales proceeds (for example given debt) to the pro-rata cost. The calculated as the ratio of the sales proceeds at the market value of the property.

When recipient, the acquisition process is also divided into a pecuniary interest and unpaid part. This results in the tax write options. For the unpaid part of the purchaser to continue the depreciation of the donor. For the pecuniary part must be based on the ratio of the purchase price to the fair market value of the building. Incurred by the purchaser’s own cost, they can also be written off.

In operating assets, other rules apply

An example: The father gives his son a rented house in 2014. The fair value is 800,000 euros, of which 500,000 euros on the building. The father had built the building in 1990 for 300,000 euros and writes it with 2 percent a year. The son acquired the building in equal or without remuneration – in other words, each to 400,000 euros for a market value of 800,000 euros. With regard to the unpaid portion of the son takes the depreciation tax base (50 percent of 300,000 euros, or 150,000 euros). The depreciation thereon then is 3,000 euros (2 percent of 150,000 euros). The cost of the building for the purchased is part amounted to 250,000 euros (400,000 euros 500,000 euros times by 800,000 euros). own depreciation method applies for this part.

In practice, not only land for private but also business assets to members are transferred free of charge. In this case, however, other tax consequences when Schenker and recipient are.